James Gandolfinin, one of the Soprano stars who died last month left an estate worth an estimated $70m.
It has been well publicised, since his death that the US Government will be hitting hard on his estate for death taxes of approx $30m. Gandolfini’s estate was made up from a range of assets and the reason for the high taxation on his estate is mainly due to whom he left the majority of his assets and the way in which he left them. The US taxation rules are the same as those in the UK that assets left to the deceased wife are exempt of tax, but Gandofini only left 20% of his estate to his wife and daughter. The remainder of his estate was split with each of his two sisters receiving 30%
Due to this, the various state and federal taxes due, at a rate of around 55%, applied to the remaining 80% of his estate and resulted in the final bill of $30 Million payable in death taxes.
Unfortunately, because his Sisters received the gifts directly, their own estates will also be subject to death duties on the values received.
Gandolfini clearly wanted to look after his sisters, however, due to the way in which he benefitted them with a direct gift, the value of that gift will be massively reduced from the amount he wanted them to have.
This could have been avoided by placing the assets in trusts for his sisters, so that they sat outside their respective estates. This was such a simple thing to do and yet it was not done.